Hong Kong residents reportedly favor minimum-wage law

HONG KONG (MarketWatch) -- About half of Hong Kong residents surveyed in a new poll favor setting a minimum hourly wage of between 28.10 and 33 Hong Kong dollars ($3.60 and $4.23), although they expect such a law would increase the city's unemployment level and possibly boost inflation, according to a report Monday in the South China Morning Post.

Union workers in Hong Kong are currently demanding a minimum wage of HK$33 an hour, while employers' groups say businesses can only sustain hourly wages in the HK$24 to HK$25 range, the report said.

A minimum wage rate of HK$28 an hour would result in a pay increase for 270,100 workers in the city, and cost businesses an additional HK$2.95 billion, the report said.

The survey, which the newspaper commissioned from market-research firm TNS, said nearly three-quarters of the 1,000 respondents believe they could live with an increase in business operating costs of between 1.1% to 5% after a minimum-wage rule is implemented.

About 64% of the respondents expect the city's unemployment would increase after the rule is implemented. That's nearly twice the 32.2% of respondents who think otherwise.

More than 83% of the respondents reportedly believed some elderly and disabled workers would lose their jobs under such a law, while about 14% disagree with that view.

Cleaning services, catering and security services industries were likely to be hit hard by the implementation of a minimum-wage statute, the report said.

Hong Kong's unemployment rate in the quarter ended July 31 fell to 4.3% from 4.6% in the three month-period ended June 30, according to recent official figures.

Nearly 45% of the respondents said a statutory minimum wage will trigger inflation, more than the 40% who believe that it won't, according to the survey.

The minimum wage is currently being discussed at the Provisional Minimum Wage Commission, which has until the end of this month to recommend a pay level to Hong Kong Chief Executive Donald Tsang, the Post reported last week.

Employers and unionists were engaged in discussions to break a deadlock, according to that report.

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